The move is most likely a threat to Android phone makers, who so
far have dominated the fast-growing, low-price smartphone market.
Competition for low-end smartphone buyers is fierce: China's
Xiaomi is poised to enter the Indian market, and Google also
plans to launch
a low-cost $100 Android One phone there as well.

As such, Samsung is most threatened by all this activity, simply
because it makes high-cost smartphones (although it also has a
range of cheap ones). Samsung's high-low strategy has given it
29% of the Indian market,
according to Business Insider Intelligence.

The threat is somewhat blunted by the fact that the Mozilla phone
will basically be a web phone with few apps: It will have 1,000
apps or so, compared with the 1.3 million available in Google's
Play store for Android.

The Intex Cloud FX will retail for 1,999
rupees ($33) in India as part of an exclusive deal with
online shopping site SnapDeal. The device features an expandable
memory of up to four gigabytes, slots for two SIM cards,
Bluetooth, and Wi-Fi.

The new phone runs on Mozilla's Firefox OS open-source operating
system, which the company is gradually rolling out across a range
of phones and tablet computers.

The low-end smartphone market has long been seen by Mozilla as
the perfect place for it to gain traction with its range of
smartphones. In an interview with The Wall Street Journal,
Jane Hsu, Mozilla's director of product, said: "More than 70% of
the phone users are still using feature phones. We understand
that the obstacle and a barrier for them is cost and usability.
India is the biggest market, and we wanted to make our first
launch for India."

Hsu goes on to reveal that the company is planning on using ultra
low-cost devices to gain a market hold, remarking: "We are
targeting to see if we can reach 1 percent market share (of
smartphones), and that’ll be a good beginning. We don’t know when
but that’s our goal."

In an interview with Business Insider in May, Mozilla chief
technology officer Andrew Gal said that the dominance of the
iPhone and Android phones in the high-end market had forced the
non-profit to look at creating cheaper devices. Deals forged with
Chinese manufacturers have given Mozilla the hope that it could
start producing $25 smartphones, although the new $33 model may
signal that manufacturing costs are not quite as low as it
initially thought possible.

Further announcements about low-cost Mozilla smartphones are
expected throughout this week.